CBDT issues revised ITR-7 form: Non-compliant trusts, religious bodies may lose tax exemption

The Central Board of Direct Taxes (CBDT) has released a revised Income Tax Return Form (ITR-7) for the Assessment Year 2025–26, with stricter reporting requirements for charitable trusts, religious institutions, political parties, and research organisations. 

The updated form, notified on May 9, aims to tighten compliance and prevent the misuse of exemptions under the Income Tax Act, 1961. 

Entities filing under Sections 11, 12, 10(23C), and 13 must now furnish more detailed disclosures of income, expenditure, and fund utilisation.

Institutions registered with the Securities and Exchange Board of India (SEBI) and under the Foreign Contribution Regulation Act (FCRA), 2010, must also use the updated ITR-7 and ensure full compliance with applicable rules. 

The he CBDT stated that the changes are intended to curb the practice of superficial compliance and ensure that only genuinely eligible entities receive tax benefits.

Tax professionals and organisations have been advised to closely review the new form to avoid errors, delays, or possible disqualification from exemption claims.